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7 Techniques Through Financial Consultancy

  • Eddie Al Asmar
  • Nov 13, 2016
  • 3 min read

Facing drawbacks in your business plans, not knowing how to allocate your capital, what activities should be followed, not knowing how to manage your services, through these simple 7 techniques through financial consultancy will earn your firm an A+ result.

1st Inventory Management Based on Stock level

Inventory is one of the major components for liquidity, having high inventory on hand with low liquidity ratios will affect a firm financial position. Having the right inventory control methods abided by your firm will not provide inventory overstock or inventory short run. The methods to follow might be Kanban or Just in time.

2nd Inventory Management Based on Opportunity Gain from Price Fluctuations

Ever wonder how to sell your inventory items if they lack expiry dates, which one goes before the other. All of this is managed by a financial consultant, by a simple procedure, follow up and based on the firms taxing system. Choosing one of the three methods FIFO, LIFO and weighted average can gain your company an opportunity gain out of your firm’s context.

3rd Costing System

Despite the pricing strategy that is being abided in your firm, costing system is a good start for measuring your product cost. Allocating the cost incurred in a firm for producing a specific type of line products is divided into two methods: Activity-based overhead costing (incurring all costs into a basket after dividing the total cost into the amount of product output) or activity-based costing also known as process costing used for mass production firms (incurring each cost for the related product produced). The drawback for each system is the contribution margin for each product where some products might become overpriced and some products become underpriced.

4th Pricing Strategy

How price to your products, what pricing strategy your competitors are following all of these issues are dealt by your financial consultant. Depending on the firms current situation the best pricing strategy is chosen by your consultant. The type of methods to be used might be a price penetrating method, a cost-based pricing method, or a demanding profit method.

5th Outsourcing or in House Production

Ever wonder that sometimes products that a firm manufactures might be cheaper if outsourced from a competitor rather than produced in house. Due to the high cost incurred from a specific product production like high fixed overhead cost associated with a variety of variable costs that is being allocated on a small amount of products that could be omitted if this is outsourced. This dilemma that might be causing the firm to save from a loss on a products line is guided through a financial consultant.

6th Benchmarking

Benchmarking is an old technique used to compare between results of different kinds, but for a financial consultant benchmarking is used as a technique to measure the time interval between each process until a product is produced. Reducing the time interval for a specific step in this process or increasing it could end up having the same product either at a faster rate or at the current rate with a lower cost.

7th Process analysis

Process analysis is interrelated to benchmarking where the above process is associated by studying the cost at each interval. This process studies the steps required for completion and investigates the parts where cost cutting can occur without effecting the entire product quality.

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